ORGANIZATION AND BASIS OF PRESENTATION	12 Months Ended
Dec. 31, 2013
ORGANIZATION AND BASIS OF PRESENTATION [Abstract]
ORGANIZATION AND BASIS OF PRESENTATION	NOTE 1 - ORGANIZATION AND BASIS OF PRESENTATION: ZAP was incorporated in California in September 1994 (together with its subsidiaries, "the Company," or "ZAP"). ZAP markets advanced transportation, including alternative energy and fuel efficient automobiles, motorcycles, bicycles, scooters, personal watercraft, hovercraft, neighborhood electric vehicles and commercial vehicles. The Company's business strategy has been to develop, acquire and commercialize electric vehicles and electric vehicle power systems, which the Company believes have fundamental practical and environmental advantages over available internal combustion modes of transportation that can be produced commercially on an economically competitive basis. In pursuit of a manufacturing plant and a partner with an existing product line, a distribution and customer support network in China and experience in vehicle manufacturing, ZAP acquired a majority of the outstanding equity in Zhejiang Jonway Automobile Co., Ltd. ("Jonway"). On January 21, 2011, the Company completed the acquisition of 51% of the equity shares of Jonway for a total purchase price of $31.75 million consisting of approximately $29 million in cash and 8 million shares of ZAP common stock valued at $2.7 million. The Company believes that the acquisition will allow it to expand its electric vehicle ("EV") business and distribution network around the world, give it access to the rapidly growing Chinese market for electric vehicles and have competitive production capacity in an ISO 9000 certified manufacturing facility with the capacity and resources to support production of ZAP's electric vehicles and new product line of mini vans and mini SUVs. Jonway is a limited liability company incorporated in Sanmen County, Zhejiang Province of the People's Republic of China ("the PRC") on April 28, 2004 by Jonway Group Co., Ltd. ("Jonway Group"). Jonway Group is under the control of three individuals, Wang Huaiyi, Alex Wang (the son of Wang Huaiyi) and Wang Xiao Ying (the daughter of Wang Huaiyi and all three individuals collectively referred to as the "Wang Family"). Jonway's approved scope of business operations includes the production and sale of vehicle spare parts, and the sale of UFO licensed vehicles. The principal activities of Jonway are the production and sale of automobile spare parts and the production and distribution of SUVs and minivans in China using the consigned UFO license from an affiliate of Jonway Group. With the completion of the acquisition of a majority interest in Jonway, the combined companies' new product lines include the A380 SUV EV and the minivan EV. Both products leverage the production moldings, the manufacturing engineering infrastructure and facilities currently in place for the gasoline models of these vehicles. Since the acquisition, the companies have been working on developing the joint product line, marketing and sales plans for the EV product lines. Jonway received certification of the EV production line by the Chinese electric vehicle authorities, which occurred in February 2013. Meanwhile; the engineering teams from both companies are undertaking extensive testing of the A380 SUV EV at Jonway Auto and ZAP Hangzhou EV research and development center. Our target is to deliver the EV A380 SUV and EV minivan in 2014, with the purpose of obtaining the Chinese central government electric vehicle incentives of up to RMB 60,000 or over $9,510 per vehicle. ZAP intends to use the existing manufacturing plant from Jonway that is being upgraded for the production of the electric vehicles and utilizing the existing Jonway models to gain economy of scale and reduce molding investment costs. ZAP also intends to leverage Jonway's distribution and customer support centers in China to support the sales and marketing of its new EV product line. In May 2012, we launched the gasoline-powered minivan models into China market. We expect this gasoline minivan series can contribute our business expansion across the world. In the meantime, Jonway auto established its three wholly-owned subsidiaries, namely, Taizhou Setting Co. Ltd, focusing on vehicles marketing and distribution, Taizhou Fuxing Vehicle Sale Co., Ltd. focusing on minivan marketing and distribution in China and Taizhou Vehicle Leasing Co., Ltd focusing on the vehicle leasing business in Taizhou. ZAP plans to focus on developing new international markets such as Brazil, South Africa, Russia and some of the Central America countries such as Costa Rica, Ecuador and Mexico. These countries are looking for affordable gasoline and electric SUVs and minivans with a competitive price and qualities. BASIS OF PRESENTATION AND CONSOLIDATION The accompanying consolidated financial statements include the financial statements of ZAP, and its subsidiaries: Jonway Automobile, Voltage Vehicles, Advanced Technology Vehicles, ZAP and ZAP Hong Kong for the years ended December 31, 2013 and 2012 and are in accordance with United States ("U.S.") generally accepted accounting principles ("GAAP"). Management considers subsidiaries to be companies that are over 50% controlled. Significant intercompany transactions and balances are eliminated in consolidation; profits from intercompany sales, are also eliminated; non -controlling interests are included in equity. We account for our 37.5% interest in the ZAP Hangzhou and our 50% interest in Shanghai Zapple using the equity method of accounting because we have significant influence but not control. ZAP's common stock is quoted on the OTC Bulletin Board under the symbol "ZAAP.OB." . Liquidity and Capital Resources In assessing our liquidity, we monitor and analyze our cash on-hand, liquidation value of our investment in securities, and our operating and capital expenditure commitments. Our principal liquidity needs are to meet our working capital requirements, operating expenses and capital expenditure obligations. In May 2012, we were approved up to an aggregate of $ 24.3 million of a credit line from the Sanmen Branch of CITIC Bank ("CITIC") through Jonway. When drawn down, the credit line was secured by land and buildings on this land owned by Jonway and guaranteed by Jonway Group. Under the above credit line, in November 2012, Jonway borrowed one year short-term loans in the aggregate amount of approximately $7.3 million. The loans were repaid in November 2013. The credit line expired in November 2013. In November 2013, we were approved up to an aggregate of $24.5 million of a credit line, with the credit exposure of $6.4 million from the Sanmen Branch of CITIC Bank ("CITIC") through Jonway. When drawn down, the credit line was secured by land and buildings owned by Jonway and guaranteed by the related party Jonway Group. Jonway borrowed one year short-term loans in the aggregate amount of $6.4 million in November 2013. The annual interest rate is 6.6%, and the loans are due in November 2014. We have also drawn $2.7 million in the form of notes payable as of December 31, 2013. We deposited 100% cash as restricted cash as collateral for these notes payable. These notes are due onApril 24 and April 29, 2014. As of December 31, 2013, the credit exposure of $6.4 million has been used, and $- million was still available for use. The credit line expires in November 2015. In December 2012, we were approved up to an aggregate of $4.1 million of a credit line, with the credit exposure of $4.1 million from Taizhou Bank. This credit line was guaranteed by related parties. As of December 31, 2013, the total outstanding loan under this credit line was $2.1 million. The annual interest rates are from 8.46% to 8.89%.The loans are due separately in January, February and May 2014, and have been repaid when due. A credit exposure of $2.0 million was used in the form of notes payable of $4.0 million with restricted cash of $2.0 million deposited with the bank. As of December 31, 2013, the total credit exposure of $4.1 million has been fully used. This credit line was reduced to $2.5 million in early 2014 when it was renewed. In December 2013, we were approved up to an aggregate of $9.2 million of a credit line from Everbright Bank. This credit line can only been used in the form of notes payable with 50% restricted cash deposited. Thus, we were approved a credit exposure of $4.6 million. This credit line was guaranteed by the shareholder Wang Huaiyi, as well as a building and land use right at the carrying value of $2.2 million. As of December 31, 2013, $8.9 million was drawn down as notes payable with restricted cash of $4.45 million deposited with the bank. As of December 31, 2013, the credit line of $8.9 million has been used, and $0.3 million ($0.15 million credit exposure) was still available for use. The credit line expires in December 2014. In December 2012, we were also approved up to an aggregate of $4.8 million of a credit line from Industrial and Commercial Bank of China (ICBC). This credit line was secured by land and buildings on this land owned by Jonway and guaranteed by related parties. This credit line expired in December 2013. In December 2013, we were approved up to an aggregate of $5.4 million of a credit line from Industrial and Commercial Bank of China (ICBC). This credit line was secured by land and buildings on this land owned by Jonway and guaranteed by related parties. As of December 31, 2013, the total outstanding loan under this credit line was $6.4 million, with $1.5 million restricted cash deposited with the bank. The annual interest rates are from 5.6% to 7.2%. The loans are due in various dates from February 2014 to November 2014. Loans due as of the date of this report have been repaid when due. We have also drawn $177,000 in the form of notes payable as of December 31, 2013. We deposited 100% cash as restricted cash as collateral for these notes payable, which were due in March 2014. As of December 31, 2013, a credit exposure of $4.9 million has been used, and $0.5 million was still available for use. The credit line expires in December 2014. Jonway intends to utilize the above credit lines to expand its electric vehicle business as well as other future vehicle models. This includes on-going working capital needs, electric vehicle production equipment requirements, testing, homologation and new EV product molds. These credit lines will also be used to support the company's expansion plans, with emphasis on its electric vehicle production line facilities in China. The credit will also help advance new electric vehicle initiatives, launch new strategic global sales and marketing operations, bolster infrastructure, and finance working capital. Also our principal shareholder, Jonway Group, has agreed to provide the necessary support to meet our financial obligations through December 31, 2014 in the event that we require additional liquidity. In addition, CEVC (China Electric Vehicle Corporation) would likely renew this convertible note and in the event that CEVC decides to call on the repayment, the repayment would likely be paid in full or in part in Jonway Auto shares or ZAP shares unless there is a breach by the Company on the covenant of the convertible note. We will require additional capital to expand our current operations. In particular, we require additional capital to expand our presence across the world, to continue development of our electric vehicle business, to continue strengthening our dealer network and after-sale service centers and expanding our market initiatives. We also require financing the investment for the continued roll-out of new products and to add qualified sales and professional staff to execute on our business plan and pursue our efforts in the research and development of advanced technology vehicles, such as the new ZAP Alias, the electric and other fuel efficient vehicles. We intend to fund our long term liquidity needs related to operations through the incurrence of indebtedness, equity financing or a combination of both. Although we believe that these sources will provide sufficient liquidity for us to meet our future liquidity and capital obligations, our ability to fund these needs will depend on our future performance, which will be subject in part to general economic, financial, regulatory and other factors beyond our control, including trends in our industry and technological developments.

NOTE 1 - ORGANIZATION AND BASIS OF PRESENTATION:

ZAP was incorporated in California in September 1994 (together with its subsidiaries, "the Company," or "ZAP"). ZAP markets advanced transportation, including alternative energy and fuel efficient automobiles, motorcycles, bicycles, scooters, personal watercraft, hovercraft, neighborhood electric vehicles and commercial vehicles. The Company's business strategy has been to develop, acquire and commercialize electric vehicles and electric vehicle power systems, which the Company believes have fundamental practical and environmental advantages over available internal combustion modes of transportation that can be produced commercially on an economically competitive basis. In pursuit of a manufacturing plant and a partner with an existing product line, a distribution and customer support network in China and experience in vehicle manufacturing, ZAP acquired a majority of the outstanding equity in Zhejiang Jonway Automobile Co., Ltd. ("Jonway").

On January 21, 2011, the Company completed the acquisition of 51% of the equity shares of Jonway for a total purchase price of $31.75 million consisting of approximately $29 million in cash and 8 million shares of ZAP common stock valued at $2.7 million. The Company believes that the acquisition will allow it to expand its electric vehicle ("EV") business and distribution network around the world, give it access to the rapidly growing Chinese market for electric vehicles and have competitive production capacity in an ISO 9000 certified manufacturing facility with the capacity and resources to support production of ZAP's electric vehicles and new product line of mini vans and mini SUVs.

Jonway is a limited liability company incorporated in Sanmen County, Zhejiang Province of the People's Republic of China ("the PRC") on April 28, 2004 by Jonway Group Co., Ltd. ("Jonway Group"). Jonway Group is under the control of three individuals, Wang Huaiyi, Alex Wang (the son of Wang Huaiyi) and Wang Xiao Ying (the daughter of Wang Huaiyi and all three individuals collectively referred to as the "Wang Family").

Jonway's approved scope of business operations includes the production and sale of vehicle spare parts, and the sale of UFO licensed vehicles. The principal activities of Jonway are the production and sale of automobile spare parts and the production and distribution of SUVs and minivans in China using the consigned UFO license from an affiliate of Jonway Group.

With the completion of the acquisition of a majority interest in Jonway, the combined companies' new product lines include the A380 SUV EV and the minivan EV. Both products leverage the production moldings, the manufacturing engineering infrastructure and facilities currently in place for the gasoline models of these vehicles. Since the acquisition, the companies have been working on developing the joint product line, marketing and sales plans for the EV product lines.

Jonway received certification of the EV production line by the Chinese electric vehicle authorities, which occurred in February 2013. Meanwhile; the engineering teams from both companies are undertaking extensive testing of the A380 SUV EV at Jonway Auto and ZAP Hangzhou EV research and development center.

Our target is to deliver the EV A380 SUV and EV minivan in 2014, with the purpose of obtaining the Chinese central government electric vehicle incentives of up to RMB 60,000 or over $9,510 per vehicle. ZAP intends to use the existing manufacturing plant from Jonway that is being upgraded for the production of the electric vehicles and utilizing the existing Jonway models to gain economy of scale and reduce molding investment costs. ZAP also intends to leverage Jonway's distribution and customer support centers in China to support the sales and marketing of its new EV product line. In May 2012, we launched the gasoline-powered minivan models into China market. We expect this gasoline minivan series can contribute our business expansion across the world. In the meantime, Jonway auto established its three wholly-owned subsidiaries, namely, Taizhou Setting Co. Ltd, focusing on vehicles marketing and distribution, Taizhou Fuxing Vehicle Sale Co., Ltd. focusing on minivan marketing and distribution in China and Taizhou Vehicle Leasing Co., Ltd focusing on the vehicle leasing business in Taizhou.

ZAP plans to focus on developing new international markets such as Brazil, South Africa, Russia and some of the Central America countries such as Costa Rica, Ecuador and Mexico. These countries are looking for affordable gasoline and electric SUVs and minivans with a competitive price and qualities.

BASIS OF PRESENTATION AND CONSOLIDATION

The accompanying consolidated financial statements include the financial statements of ZAP, and its subsidiaries: Jonway Automobile, Voltage Vehicles, Advanced Technology Vehicles, ZAP and ZAP Hong Kong for the years ended December 31, 2013 and 2012 and are in accordance with United States ("U.S.") generally accepted accounting principles ("GAAP").

Management considers subsidiaries to be companies that are over 50% controlled. Significant intercompany transactions and balances are eliminated in consolidation; profits from intercompany sales, are also eliminated; non -controlling interests are included in equity. We account for our 37.5% interest in the ZAP Hangzhou and our 50% interest in Shanghai Zapple using the equity method of accounting because we have significant influence but not control.

ZAP's common stock is quoted on the OTC Bulletin Board under the symbol "ZAAP.OB."

Liquidity and Capital Resources

In assessing our liquidity, we monitor and analyze our cash on-hand, liquidation value of our investment in securities, and our operating and capital expenditure commitments. Our principal liquidity needs are to meet our working capital requirements, operating expenses and capital expenditure obligations.

In May 2012, we were approved up to an aggregate of $ 24.3 million of a credit line from the Sanmen Branch of CITIC Bank ("CITIC") through Jonway. When drawn down, the credit line was secured by land and buildings on this land owned by Jonway and guaranteed by Jonway Group. Under the above credit line, in November 2012, Jonway borrowed one year short-term loans in the aggregate amount of approximately $7.3 million. The loans were repaid in November 2013. The credit line expired in November 2013.

In November 2013, we were approved up to an aggregate of $24.5 million of a credit line, with the credit exposure of $6.4 million from the Sanmen Branch of CITIC Bank ("CITIC") through Jonway. When drawn down, the credit line was secured by land and buildings owned by Jonway and guaranteed by the related party Jonway Group. Jonway borrowed one year short-term loans in the aggregate amount of $6.4 million in November 2013. The annual interest rate is 6.6%, and the loans are due in November 2014. We have also drawn $2.7 million in the form of notes payable as of December 31, 2013. We deposited 100% cash as restricted cash as collateral for these notes payable. These notes are due onApril 24 and April 29, 2014. As of December 31, 2013, the credit exposure of $6.4 million has been used, and $- million was still available for use. The credit line expires in November 2015.

In December 2012, we were approved up to an aggregate of $4.1 million of a credit line, with the credit exposure of $4.1 million from Taizhou Bank. This credit line was guaranteed by related parties. As of December 31, 2013, the total outstanding loan under this credit line was $2.1 million. The annual interest rates are from 8.46% to 8.89%.The loans are due separately in January, February and May 2014, and have been repaid when due. A credit exposure of $2.0 million was used in the form of notes payable of $4.0 million with restricted cash of $2.0 million deposited with the bank. As of December 31, 2013, the total credit exposure of $4.1 million has been fully used. This credit line was reduced to $2.5 million in early 2014 when it was renewed.

In December 2013, we were approved up to an aggregate of $9.2 million of a credit line from Everbright Bank. This credit line can only been used in the form of notes payable with 50% restricted cash deposited. Thus, we were approved a credit exposure of $4.6 million. This credit line was guaranteed by the shareholder Wang Huaiyi, as well as a building and land use right at the carrying value of $2.2 million. As of December 31, 2013, $8.9 million was drawn down as notes payable with restricted cash of $4.45 million deposited with the bank. As of December 31, 2013, the credit line of $8.9 million has been used, and $0.3 million ($0.15 million credit exposure) was still available for use. The credit line expires in December 2014.

In December 2012, we were also approved up to an aggregate of $4.8 million of a credit line from Industrial and Commercial Bank of China (ICBC). This credit line was secured by land and buildings on this land owned by Jonway and guaranteed by related parties. This credit line expired in December 2013.

In December 2013, we were approved up to an aggregate of $5.4 million of a credit line from Industrial and Commercial Bank of China (ICBC). This credit line was secured by land and buildings on this land owned by Jonway and guaranteed by related parties. As of December 31, 2013, the total outstanding loan under this credit line was $6.4 million, with $1.5 million restricted cash deposited with the bank. The annual interest rates are from 5.6% to 7.2%. The loans are due in various dates from February 2014 to November 2014. Loans due as of the date of this report have been repaid when due. We have also drawn $177,000 in the form of notes payable as of December 31, 2013. We deposited 100% cash as restricted cash as collateral for these notes payable, which were due in March 2014. As of December 31, 2013, a credit exposure of $4.9 million has been used, and $0.5 million was still available for use. The credit line expires in December 2014.

Jonway intends to utilize the above credit lines to expand its electric vehicle business as well as other future vehicle models. This includes on-going working capital needs, electric vehicle production equipment requirements, testing, homologation and new EV product molds. These credit lines will also be used to support the company's expansion plans, with emphasis on its electric vehicle production line facilities in China. The credit will also help advance new electric vehicle initiatives, launch new strategic global sales and marketing operations, bolster infrastructure, and finance working capital. Also our principal shareholder, Jonway Group, has agreed to provide the necessary support to meet our financial obligations through December 31, 2014 in the event that we require additional liquidity. In addition, CEVC (China Electric Vehicle Corporation) would likely renew this convertible note and in the event that CEVC decides to call on the repayment, the repayment would likely be paid in full or in part in Jonway Auto shares or ZAP shares unless there is a breach by the Company on the covenant of the convertible note.

We will require additional capital to expand our current operations. In particular, we require additional capital to expand our presence across the world, to continue development of our electric vehicle business, to continue strengthening our dealer network and after-sale service centers and expanding our market initiatives. We also require financing the investment for the continued roll-out of new products and to add qualified sales and professional staff to execute on our business plan and pursue our efforts in the research and development of advanced technology vehicles, such as the new ZAP Alias, the electric and other fuel efficient vehicles.

We intend to fund our long term liquidity needs related to operations through the incurrence of indebtedness, equity financing or a combination of both. Although we believe that these sources will provide sufficient liquidity for us to meet our future liquidity and capital obligations, our ability to fund these needs will depend on our future performance, which will be subject in part to general economic, financial, regulatory and other factors beyond our control, including trends in our industry and technological developments.